The Commonwealth Bank has just released its latest Business Sales Indicator (BSI) and says there are early signs that Joe Hockey’s small business stimulus plan is working.
The bank said that the BSI, “which includes businesses such as Office Furniture, Commercial Equipment, Electrical Parts and Computers, and Computer Equipment and Software, recorded spending growth of 1.9 per cent in trend terms in May – the biggest rise since May 2012“.
In trend terms the move was a more reserved 0.8% in May, which is in line with the gains in March and April. But that still means “annual sales growth stood at 7.5 per cent, well above the decade average of 5.3 per cent,” the bank said.
Across sectors, spending fell in just two of the 19 industry sectors in trend terms in May. Sectors which experienced contractions were Airlines and Mail Order/Telephone Order Providers.
Of course, the budget measures and the deductibility for annual business tax returns means that May and June will likely pull forward demand from the second half of the year to meet the June 30 cut off date for this financial year.
Overall, “May’s growth in sales will be welcome news for Australian business owners, suggesting businesses and consumers across the country are feeling confident about spending off the back of the Federal Budget,” according to Claire Roberts, the executive general manager of local business banking at the Commonwealth Bank.